Upstart Reviews

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Upstart is an online credit marketplace, based in Palo Alto, California. The company was founded by ex-Google employees, enticed by fintech’s potential to facilitate credit. Upstart provides personal and debt consolidation loans, typically for student loans or credit card refinancing.

Upstart doesn’t offer online small business loans in the traditional sense, but aspiring entrepreneurs have financing options nevertheless. Business owners seeking capital can apply for personal loans for business. Qualifying borrowers can access up to $50,000, which is lower than a traditional small business line of credit but is higher than personal loan limits at competitors Kabbage loans, Lending Club, Loan Me and Prosper loans. See our Prosper loans reviews, Kabbage reviews and Lending Club reviews for comparisons to this Upstart reviews page).

The extent to which Upstart uses artificial intelligence to propagate lending decisions is what separates Upstart from the competition. In fact, one quarter of all loans on their direct to consumer platform are 100% automated, as reported on the alternative financing website ‘debanked’.¹  This allows lending decisions to be made in a matter of minutes with funding as fast as next business day.

According to their website, Upstart has originated 241,000 loans (as of February 1, 2019) with annual percentage rates between 8.09% and 35.99%. The loan maturities range from 3 to 5 years.  And as they report in the footnotes, the average 3-year loan carries an APR of 19%.

As you can see, quick business loans don’t come particularly cheap. But compared to some alternative funders, like MCAs, certain asset based lending companies, or small business credit cards, 19% can be a bargain.

In certain states (including North Carolina, Arizona and Oklahoma) loans are made by Cross River Bank of New Jersey.

Upstart Loans Criteria

Commercial banks rely heavily on FICO scores and credit history. But Upstart co-founder Dave Girouard revealed some alternative metrics. Their algorithms analyze data hundreds of data points including the applicant’s employer, industry, school attended-even major.² Startup or bad credit business loans are nearly impossible to obtain at traditional banks. But Upstart personal loans for small business provide a way for entrepreneurs to follow their dreams.

Upstart Loans Pros and Cons

In addition to the Upstart personal loans reviews above, we summed up the pros and cons:

Main Pros:

·       Hundreds of variables factor into a decision, not just credit scores.

·       No down payment or prepayment penalties.

·       Borrow up to $50,000 in capital (higher than come competitors).

·       90% customer approval, based on an internal customer survey.

·       Get your rate in about 5 minutes.

Main Cons

·       Unproven track record in an economic downturn.

·       Some businesses want funding options that don’t incur debt, like invoice factoring.

·       Average APR for 3-year loans is 19%.

For more information on Upstart:

Who Primarily Uses Upstart Loans?

Where does Upstart’s capital base come from?

Do they offer other small business funding options?

Does Upstart provide U.S. based customer support?

^1,2https://debanked.com/2017/05/the-tesla-of-alternative-lending/